Send me email updates about messages I've received on the site and the latest news from The CafeMom Team.
By signing up, you certify that you are female and accept the Terms of Service and have read the
Privacy Policy.

GOP targets child tax break for illegal immigrants

WASHINGTON — Republicans
are looking to deny child tax credits to illegal immigrants — refund
checks averaging $1,800 a family — in an effort that has roused anger
among Hispanics and some Democratic lawmakers.

The proposal,
which would require people who claim the federal credit to have Social
Security numbers to prove they're legal workers, is being offered as a
way to help pay for extending the Social Security tax cut for most
American wage-earners. It would trim federal spending by about $10
billion over a decade.

Senate Majority Leader Harry Reid of
Nevada says the proposal unfairly goes after the children of poor
Hispanic workers. Such kids often are U.S. citizens, even when their
parents aren't, because they were born in this country.

Says
Leticia Miranda, senior policy adviser of the National Council of La
Raza: "People who are making close to the minimum wage and are raising
children in this country — and we're asking them to pay for the payroll
tax cut?" She says, "It's outrageous and it's crazy."

On the
other side, Republicans and some Democrats say what's crazy is even
having a debate over whether the government should be cutting checks to
people who have sneaked into the country illegally. It's hard to imagine
there isn't a healthy majority, even in the Democratic-controlled
Senate, to stop the practice — if it's actually brought to a vote.

"We have rules about tax credits and benefits, and it seems to me they
need to be applied fairly and across the board," said Democrat Sen.
Claire McCaskill, who is facing a difficult re-election bid in Missouri.
"If there are rules, they need to be enforced. I think it's just that
simple. I don't think it's complicated."

Illegal immigrants have
been barred from other refundable tax credits — in which low-income
workers not only don't owe income taxes but receive payments from the
government — such as the earned income tax credit. Such credits are a
popular anti-poverty tool in part because a recipient has to hold a job
to receive the benefit.

But a 1997 law enacting a $500 per-child
tax credit doesn't specifically exclude illegal immigrants from
collecting. It was significantly expanded in 2001 to gradually reach
$1,000, and rules were eased so that many more people could get it on a
refundable basis. It was made more generous in 2009 so that more
taxpayers could claim the credit or claim a larger amount. The expanded
credit is slated to expire at the end of the year along with other
Bush-era tax cuts and return to $500 per child, though it's commonly
assumed that it will remain up to $1,000 per child.

"Although
the law prohibits aliens residing without authorization in the United
States from receiving most federal public benefits, an increasing number
of these individuals are filing tax returns claiming this refundable
credit," Rep. Sam Johnson, R-Texas, said when the House debated the
payroll tax cut measure in December. "Illegal immigrants bilked $4.2
billion from the U.S. taxpayers (in 2010). I think that it's time that
we fixed it."

The situation has Democrats in a box. If they fight
the GOP effort to cut back payments of the tax credit, they'll be
favoring the delivery of refunds to people who not only don't owe income
taxes but aren't supposed to be in the country in the first place.

What's
more, closing the loophole would raise real money — an estimated $10
billion over 10 years under the approach favored by House Republicans.

The
Treasury Department says that in the 2010 filing year more than $4
billion in child credit refunds went to 2.3 million people who filed tax
returns but didn't have Social Security numbers proving they were
citizens or legal workers. That's a four-fold increase over five years
earlier.

On the other side are politically influential Hispanic
groups, a key Democratic-friendly constituency. Opponents of tightening
eligibility for the child tax credit point out that six of every seven
affected families are Hispanic, with an average household income of
about $21,000. Tax credits of up to $1,000 per child and make a huge
difference at such income levels.

Hispanics point out that in
many instances the tax credit goes to workers who aren't citizens but
whose children are — because they've been born in the country and
therefore have Social Security numbers of their own. They say such
children should reap the benefit of the tax credit just like other
children in comparable economic circumstances.

"I just think the
child tax credit is working just fine and there's no need to punish
children," Sen. Reid said last week. "We're supposed to try to be
helping them."

One option under consideration is to require tax
filers to supply a Social Security number for the child when claiming
the tax credit instead of requiring that at least one of the parents
possess one. That would respond to criticism that the GOP proposal is
unfair to the citizen children of illegal immigrants.

"We're not
in favor of fraudulent payments or payments that shouldn't be made, but
we don't want to create obstacles to supporting low-income families who
are trying to care for their children," said Sen. Dick Durbin, D-Ill.
"Even though the parent doesn't have a Social Security number, they
could still be entitled under their tax return, for a child tax credit."

Congress
needs to find about $160 billion between now and the end of the month
to cover the costs of extending through Dec. 31 a Social Security tax
cut averaging about $20 a week for 160 million workers, federal
unemployment benefits for the long-term jobless and unreduced Medicare
fees for doctors. All are now due to expire Feb. 29.

Send me email updates about messages I've received on the site and the latest news from The CafeMom Team.
By signing up, you certify that you are female and accept the Terms of Service and have read the
Privacy Policy.